مجموعة ٣٠/ ٢٢٤ "ترتيبات العملة في المشيخات العربية في الخليج الفارسي." [و‎‎١‎٨‎٣] (٦٢٠/٣٨٠)

of the applications When satisfied on this score, and
having verified that the applications was<_within the
quotas allowed to the applicants, t&e Political Agents
issued Recommendation Certificates in duplicate giving
a description of the goods, their value,and names of
ports of import and the countries of export. Banks
were authorised by the Reserve Bank of India to open
letters of credit and to make remittances of foreign
exchange against these Recommendation Certificates
without reference to the Government of India. Political
Agents were required to submit monthly statements
showing the Certificates they had issued.
(3>
It will be seen from this that :
(4)
(5)
(a)
Exchange Control only ooerated so far as imports
were concerned, and that there was nothing to
prevent individuals obtaining hard currency from
their own trading activities^if they could find
goods required by the hard currency area.
(b)
(c)
Merchants and others were not required to
surrender or even to disclose their hard currency
holdings.
The jbi js/cal export of sterling or rupee
securities etc. was unrestricted.
So far as the Oil Companies of above are concerned, it
has been possible to Effect control over their currency
requirements as they are British Companies. The
Koweitff Oil CompankaM* and the Bahrein Company have
to account to the Bank of England for all currency
receipts and to apply to thab-©£* all currency requirements
Royalties are paid in sterling a&ea rupees. It may be
noted here,however, that unless we can induce him to
agree formally to the inclusion of his state within the
sterling area and to accept the attendant obligations,
the Shikb^ of Koweit might well decide to grant his
rights in the Neutral Zone to an American Company in
order to obtain royalties payable in dollars.
Ik -
Exchange Control in Persian Gulf is to be taken
over by the Bank of England as soon as possible. It
therefore appears that the Gulf and Muscat will be in
the position of having their rupee currency controlled
from India and their foreign exchange requirements
controlled from the U.K. I am not aware of the
developments in India and Pakistan over the separation
of their currencies, but it is presumably possible that
before long two rupee currencies will have come into
existence
/■*
The drafts emd eneleoureo-'-teelow^ produoed by the Treasury, are
intended to meet the need for tighter control over foreign exchange
in the Gulf. It is apparently intended that measures in the Gulf
Sfould be brought into line with the principles and practice
adopted in the U.K. with such variations as local conditions may
require. Before control upon these lines could be A»<s>duced, the
following moves w»13i appear to be necessary
(1) The^fS^reement of the Rulers concerned to the inclusion of
their States within the sterling area and te. their acceptance of
the obligations which this implies.
(2) Legislation to provide for control measures considered
essential but which cannot effectively be operated through banks
al0ne - •
/?.would clearly